I hope this exciting New Year of 2012 finds you having had an absolutely wonderful Holiday Season!  Did you receive the gifts you wanted most?  I sure hope so!  The greatest gift I received was all of my family ending the year in good health and enjoying life.

I began writing this update during the last few days of 2011, as the markets around the world were coming to a close for the year.  As I am sure you are aware, 2011 turned out to be a loss for most asset classes and world markets.  In fact, even though the U. S. markets were down last year, the U.S. actually fared better than most of the rest of the world -- some of which ended down 20% or more.

Without a doubt, during the 23 years we have been managing investment portfolios for our clients, 2011 was the most difficult and frustrating, even worse than the “2008-2009 Bear Market.”  Early last year, the earthquake and tsunami in Japan seemed to start the wild swings in stock values.  Then, through the rest of 2011, we had the crazy political battles in Washington over the U. S. debt issues, the revolts in the Middle East and, of course, the ongoing debt crisis in Europe!

I thought you would find very interesting the following comments from Barry Ritholtz, who is well known throughout the investment world, is widely broadcast over financial TV, and now publishes a weekly column in the Washington Post.  He wrote:

“Tough Year!”

We hear that around the office nearly every day – from professional traders to money managers to even the ‘most-hedged’ of the hedge fund community. This year’s markets have perplexed the best of them. Each week brings another event that sets up some confusing crosscurrent: call them reversals or head fakes or bear traps or (my personal favorite) the “fake-out break-out” – this volatile, trendless market has been unkind to Wall Street pros and Main Street investors alike.

Indeed, buy & hold investors have had more ups and downs this year than your average rollercoaster. The third and fourth quarters alone had more than a dozen market swings, ranging from 5 percent to more than 20 percent. Despite all of that action, the S&P 500 is essentially unchanged year-to-date. It doesn’t take much to push portfolios into the red these days.

History documents that short periods will occur where performance falls off.  Despite the difficulties of the past year, Couture Financial’s track record of providing our clients with excellent long-term investment results remains strong.  As long as we keep our nose to the grindstone (so to speak) and consistently apply our market and economic research toward the timely allocation adjustments within your portfolio, our effective record will likely endure.  Of course, you know there are no guarantees of profit and all investments have risks and can gain or loose value over time.

I am looking forward to a much better year in 2012!  I hope it is great for all of us.